The problem with the sky is a glitch in the world editor that happens when you zoom out too much, I'll mess with the terrain outside the picture a little to see if I can get a good angle without having to zoom out the cam.
thedeathunterxx, there is a very light yellow fog, and the reason I didn't use fogged sky is because I wanted it to look like it was in another world, not in Azeroth.
Oh, and also, that is the back of the dragon, he is looking at the sun.